• The EU is negotiating a free trade agreement with India, aiming for a conclusion by the end of 2023.
• Ursula von der Leyen emphasized the urgency of the agreement during her visit, citing geopolitical reasons.
• Both sides seek collaboration in various sectors, including technology, defense, and clean energy.

NEW DELHI: In a significant development for international trade, the European Union is advancing discussions with India to establish a free trade agreement, with a target date set to conclude negotiations by the end of 2023. European Commission President Ursula von der Leyen, on her recent visit to India, underscored the need for such an agreement amid mounting trade tariffs imposed by the United States.

Von der Leyen stated, “I am well aware it will not be easy. But I also know that timing and determination counts,” reflecting the urgency of the negotiations. The EU, which has been India's largest trading partner, is looking to deepen ties that are currently valued at approximately €124 billion (about $130 billion) for 2023, as noted in her remarks at a meeting with Indian Prime Minister Narendra Modi.

Both leaders announced a shared commitment to finalize the free trade pact, which has been in discussion since 2021 after a hiatus of eight years. The agreement’s broad scope targets cooperation in sectors such as semiconductors, artificial intelligence, and clean technology, aiming to enhance economic resilience and counteract potential tariffs from the U.S., as von der Leyen has warned about possible 25% tariffs on EU goods under U.S. President Donald Trump’s administration.

Additionally, discussions will advance toward exploring a future Security and Defence Partnership with India, akin to existing partnerships with Japan and South Korea. This initiative highlights the EU's strategic intent to bolster security cooperation in response to increasing challenges posed by global powers, particularly amid tensions rising from both geopolitical shifts and economic pressures.

Notably, the EU’s desire for an ambitious trade agreement encounters several barriers, including India's protective tariffs on various goods. The goal is to reduce tariffs exceeding 100% on products like cars and wines, while India seeks expanded access for its pharmaceuticals and textiles in the EU market. Despite longstanding challenges, the determination of both parties to achieve a breakthrough reflects their recognition of the mutual benefits of a closer economic partnership. BBC has remarked upon India’s shifting sentiment towards trade agreements, now more proactive in pursuing various international partnerships.

As the year progresses, these negotiations symbolize not only economic aspirations but also a strategic pivot in an evolving global landscape, where cooperation may prove vital against isolationist tendencies that threaten economic stability.